Oh, ye of little faith.
Social Media has been a trending topic for quite some time now. Tomes have been written (here and elsewhere) about the quick assimilation of Facebook, Twitter, YouTube, et al into the lives and media habits of Americans of basically every stripe. And plenty of examples exist of how mainstream companies and products have scored big paydays by immersing themselves into Social Media. Yet, despite all of this, only about a quarter of American businesses have jumped into the deep end of Social Media.
So what’s the hold up? Well, as the accompanying graph (courtesy of eMarketer.com) points out, the big hiccup in the eyes of many organizations (more than 1/3) relates to ROI. How will they know if the expenditures on Social Media will pay off? Is Social Media truly a brave new world where the tools are free and your followers do all the “selling?” Or, is it a giant black hole that’s going to demand more and more resources with precious little to show for it?
Business leaders can be excused for their skepticism of Social Media as a platform for selling more widgets. They see how their teenagers use Facebook. They read about people tweeting what they had for lunch. They see YouTube as a venue for cute cat videos. And, unfortunately, folks in my position haven’t been a ton of help when we talk about Social Media as a forum for “engagement,” not for “selling” (without explaining in down-to-earth language how that engagement is a critical element in the selling process).
One way to approach the ROI barrier is to take a look at how we determine it with traditional media like TV, radio, magazine, outdoor, etc. that we know works. None of the ROI is up front. It’s all after the fact. We spent so-and-so on media for the quarter, and our sales were such-and-such. You can chart year-over-year incremental sales and attribute the extra sales (or increased margin) to your ad expenditure.
In other words, you’re doing it on faith. Not ill-placed faith to be sure. But the naked truth is that you are betting numbers with lots of zeros behind them on projections. On forecasts. The same way you decide how to dress based on a weather forecast. It is only after-the-fact that you see if your projections were correct.
But for many business leaders, this kind of faith has no place in the discussion of Social Media. What we need are hard numbers.
The irony is, of course, is that Social Media gives you access to plenty of hard numbers. Hard accurate numbers. Even free analytic tools allow you to measure your impact in Social Media with a real-time accuracy that would be the envy of any offline media, which still pretty much rely on historical data from set-top boxes and diaries.
Analytics can show you how many people are talking about you, what they are saying (positive, negative or neutral), how many are joining your communities, how many site visits you have, how many downloads you’ve issued, where your visitors come from, how many times they’ve come to you, how many thought leaders have linked to you, and so on.
But alas, even these numbers have little to do with sales or ROI. In fact, I would submit that the most important aspects of a Social Media program will never be measured. Because Social Media is conducted on a one-to-one basis (in front of thousands of spectators), Social Media’s strength is its ability to strengthen the relationship between marketer and customer. To resolve customer service issues before the customer decides to take a powder (or vent elsewhere). To reward frequent and loyal customers with special access and considerations (and giving them the tools and permission to talk you up in their communities). To get input from customers on possible product offerings and initiatives. To conduct quick-and-dirty surveys. To work casual customers up the loyalty ladder. To provide several new portals through which to engage the organization.
Just because you can’t measure stuff like this doesn’t mean it won’t have a huge impact on your business’s bottom line.
All it takes is a little faith.
Posted by Mickey
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